The United States Justice Department has revealed an indictment against cryptocurrency exchange KuCoin and its two founders for engaging in an unlicensed money transmitting business and violating the Bank Secrecy Act. The indictment accuses KuCoin founders Chun Gan and Ke Tang of deliberately neglecting to establish an Anti-Money Laundering program, resulting in the exchange being used for illicit activities such as money laundering and terrorist financing. The company itself is charged with operating without a license and breaching the BSA.
According to U.S. Attorney Damian Williams, KuCoin and its founders intentionally concealed the fact that a significant number of U.S. users were trading on their platform. Williams highlighted that KuCoin capitalized on its substantial U.S. customer base to become one of the world’s largest cryptocurrency derivatives and spot exchanges, facilitating billions of dollars in daily trades and trillions of dollars in annual trade volume.
The U.S. Department of Justice announced these criminal charges in conjunction with a civil enforcement case by the U.S. Commodity Futures Trading Commission (CFTC). The CFTC charged KuCoin with multiple violations of the Commodity Exchange Act (CEA) and CFTC regulations. The Justice Department alleges that KuCoin received over $5 billion and sent over $4 billion of suspicious and criminal funds.
KuCoin was founded by Chun Gan and Ke Tang in 2017, with its operational headquarters located in Seychelles, according to its website. Both founders, who are Chinese nationals, are currently at large.
U.S. authorities have been actively pursuing similar criminal charges against cryptocurrency exchanges and their executives operating in the country. Recently, former FTX CEO Sam Bankman-Fried was convicted on seven felony charges and is scheduled to be sentenced on March 28. The former CEO of Binance, Changpeng Zhao, is expected to be sentenced on April 30.
The United States enforcement agencies are intensifying their efforts to combat crypto-related crimes.